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Trade of the Day: Target (TGT)

Target (TGT) looks bullish, despite a temporary pullback


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It’s always nice when a stock’s trading patterns align so that I end up making a bullish bet on a company I like. And when you need paper towels, toys for the kids or even new furniture, Target (NYSE:TGT) is one of my go-to big box stores for a decent (though not bargain-barrel) price.

The stock has confirmed its upward trend after a temporary pullback. Such a bounceback is one of the most reliable buy signals for a long position or call options. The stock has a support level at $62, and volatility is below average—which means you’ll probably won’t be surprised by a drastic downshift.

Recommendation: Buy TGT July 70 call options at 95 cents or lower, when the stock price is around $65.90. After entry, take profits if the stock price hits $68.50 or the option price reaches $1.90. Exit if the stock price closes below $64.60 or the option price falls to 60 cents.


InvestorPlace advisor Ken Trester is editor of the popular Maximum Options program. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.  Try Maximum Options today for 2 months for only $99.

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